31 minute read
A New Model of Value Creation
SVC Viewpoint/
→ Global Millennial Capital uses artificial intelligence (AI) and deep learning to revolutionize the traditional way of investment evaluation and decision approach.
A NEW MODEL OF VALUE CREATION
GLOBAL MILLENNIAL CAPITAL FOUNDER ANDREEA DANILA
is using deep learning and artificial intelligence to disrupt the traditional venture capital investment process
by TAMARA PUPIC
Andreea Danila, founder and Board Member of Global Millennial Capital, used to research and test the randomness of returns distribution of venture capital (VC) early-stage investments with the aim to generate top quartile returns outcomes, and for many, that would have been too complex a problem to solve. Yet, Danila, having studied at Massachusetts Institute of Technology and Harvard Business School, has always aimed high- and that’s the mindset with which she tackled this issue in front of her as well. “Today, Global Millennial Capital is the first investor to introduce the concept of artificial intelligence (AI) and deep learning to revolutionize the traditional way of investment evaluation and decision approach,” Danila says. “As the first venture capital firm to make strategic investments on a relatively new data-driven thesis, we focus our efforts on a continuous basis to support our goals of achieving a leading position as an emerging fund manager, and, most importantly, as a homegrown brand from the UAE.”
This ethos is supported by Global Millennial Capital’s development of a proprietary data science algorithm that aims to generate statistically correct returns in early-stage deals. “As a data-driven investor, we even challenge the effectiveness of our own investing style and value creation approach as participants in the digital economy,” Danila explains. “For example, for verticals such as cryptocurrencies and blockchain, the average time to reach a unicorn valuation is around 18-24 months, with some examples in the US, such as Certik, a security audit firm for the Web3 industry, and non-fungible token (NFT) domain name provider and digital identity platform, Unstoppable Domains, being valued at above US$1 billion in Series A itself. At the same time, we analyze the cycles of disruptions as it pertains to funding velocity, a metric we use internally in our data algorithm, shorter by about three to five years.”
Danila adds that the Global Millennial Capital team also takes a new approach to value creation and redesigns the investment approach by focusing on initiatives like identifying top-quartile early-stage technology companies that have a high ranking and success score, evaluating a robust minimum viable product (MVP) with a superior innovation score, and, lastly, advising their entrepreneurs to be limitless in the pursuit of bold and transformative visions, while maintaining focus on achieving operating goals. “As early-stage investors, our focus is that our portfolio companies enter the early growth stage phase with strong operating and performance indicators, and are able to attract interest from reputable Series A investors, such as Sequoia, Anderson Horowitz, and Tiger Global, to name a few,” Danila says.
The fund’s data-driven strategy, which positions it at the intersection of fintech and venture capital and creates its scalable and differentiating value proposition, has led to 10 investments in the American fintech space to date. “We hope to be the first VC from the Middle East to bring to the regional stakeholders a few unicorns from Silicon Valley,” Danila says. Some of the firm’s notable investments include Transcrypts, a Harvard-founded blockchain for document identification technology, Blue Studios, a Web3 crypto digital wallet for families and kids, Nexus, a Y Combinator-backed robo-advisory technology company that improves checking account money productivity by enabling equity type returns with liquidity, and Envel, a Harvard-founded and Massachusetts Institute of Technology-backed fintech startup that uses AI to assist with automated investment and saving recommendations.
“One of the most relevant proofs of concepts that data and AI could generate superior returns lies in our latest case study, where we invested in Seashell, a blockchain technology for financial services set to generate high yields in an inflationary environment and reimagine the flow of money,” Danila adds. “The founder, Daryl Hok, was previously the founding member of a $2 billion (equity value) blockchain security company Certik, and also a founding member of Fiscal Note, a $1.4 billion (equity value) analytics company. Global Millennial Capital co-invested in the round with the likes of Vlad Tenek, Mark Cuban, Khosla Ventures, and Avalanche, just to name a few.”
Danila reveals here that Global Millennial Capital has been invited to join Harvard Business School’s Impact Finance Consortium, alongside Wharton Business School and Chicago Booth, and that it is also considered to be the first MENA venture capital investor to adopt the United Nations Sustainable Development Goals in its investment framework on themes like innovation, gender equality, and catalytic capital, among others. All of this is, according to Danila, a recognition of the fund’s investment philosophy and impact. “Global Millennial Capital endeavors to position itself as the ‘first to innovate’ in the venture capital segment,” she says. “We seek alpha strategies by investing in visionary ideas and founders from Silicon Valley, and over the last years, we have created a global
SVC Viewpoint/
network in collaboration with the world’s best academic institutes, bringing fresh new perspectives on traditional topics such as investing using data and AI.”
Although Danila aims to focus on her enterprise’s global expansion in the next three years, she highlights that, instead of rapidly scaling a business, the key to success in her field will always be based on one’s commitment to constant learning. “I believe each leadership journey is very specific not only to market conditions, opportunities, and sector expertise, but also to our systems of values, principles, and beliefs,” she says. “We have seen a significant transformation in the financial services and fund management industries in recent years, with trends such as decentralized finance, crypto, and Web3 emerging and disrupting operating models, coupled with the mass access to financial education and financial inclusion that triggered a shifting power from the institutional investors to the consumers of financial services information and products. It is a very new environment, and we need to thrive to constantly adapt, upskill and eventually lead in these emerging spaces.”
Such a philosophy also points to how Danila has reached her goals in life so far. A native of Romania, Danila worked in London and Singapore before relocating to the Middle East in 2010 and joining an alternative asset management firm based in DIFC, which went on to become an award-winning buy-out private equity player managing $1.5 billion of assets under management in MENASEA with more than 55 investments. After gaining such insightful private equity experience firsthand, she worked for global consulting firm Ernst and Young’s Corporate Finance arm, where her role focused on advising financial institutions and corporates around areas of mergers and acquisition, market entry strategies, joint ventures, and buy-outs and carve-outs with exposure to the consumer and technology sectors.
In late 2020, at a point which she describes as “at the bottom of COVID-19 market,” she teamed up with a couple of institutional investors who felt that the timing to invest and acquire stakes in technology companies in the US was favorable. “I pitched the idea of creating a data-driven fund over a Zoom call, with the vision to create a new model of venture capital in the Middle East, and provide access to Silicon Valley’s most prominent earlystage technology companies,” Danila explains. “A large number of qualified investors backed my vision as a blank cheque new hedge fund manager, regulated offshore by the Financial Services Commission in the British Virgin Islands.” When it comes to her view pertaining to the local developments in the region when it comes to entrepreneurship and venture capital, Danila believes that the UAE is an attractive destination for global entrepreneurship, given its macroeconomic environment, government initiatives as well as its seamless transition to a hybrid work model. “We are particularly interested in the developments around AI in the UAE, as well as the various initiatives around blockchain and metaverse sectors, which tend to assist the further positioning of the country as an emerging global innovation hub well-positioned to attract global talent, especially in the areas of engineering, coding, and computer science,” Danila says. “Lastly, we observe a growing trend when it comes to the emergence of public and private funds, with strategies and allocations for funds of funds, venture capital, and startups regionally and globally.” All of this serves to explain why Danila’s advice for entrepreneurs is to set up (and settle) in a place that offers access to smart funding, a friendly regulatory environment, and a cultural mindset focused on growth- again, she is talking about the UAE, and for all the right reasons.
→ Andreea Danila, founder and Board Member of Global Millennial Capital.
WE WERE EARLY MOVERS IN DIGITAL PAYMENTS AND TOOK A CLASSIC ‘IF YOU BUILD IT, THEY WILL COME’ APPROACH.
S/Ecosystem
→The 42nd installment of GITEX GLOBAL brought together about 5,000 companies from 90 countries whose products were showcased to over 138,000 attendees.
The Ties That Bind
Lessons on networking (from those who did it right) at the 2022 edition of GITEX GLOBAL by TAMARA PUPIC
SINCE ITS LAUNCH IN 1981, GITEX GLOBAL has grown into one of the world’s largest technology exhibitions, and it has also made Dubai’s presence felt on the global technology map along the way. However, despite the event already being recognized for its grandiosity, the 2022 edition of GITEX GLOBAL has surprised everyone, with a common refrain from attendees being: “It’s the biggest event ever!”
Indeed, the 42nd installment of GITEX GLOBAL brought together about 5,000 companies from 90 countries whose products were showcased to over 138,000 attendees throughout the five-day trade fair at Dubai World Trade Centre in Dubai. It encompassed the North Star startup conference that gathered 35 unicorns from 15 countries, a summit centered on artificial intelligence (AI) named Ai Everything, the Future Blockchain Summit, the digital finance summit FinTech Surge, and the martech event Marketing Mania. Plus, there were two new events- the coder and developer meetup Global DevSlam, and XVERSE, the immersive metaverse gathering that featured 28 experiential brands.
While it’s clear that the event gave the attendees the opportunity to assess the latest developments and innovations in technology like 5G, artificial intelligence, cloud technology, cybersecurity, fintech, blockchain, data analytics, and smart cities, GITEX GLOBAL 2022 also proved to be an excellent site to harness the power of networking. This is especially relevant in a world returning to normalcy after the COVID-19 crisis, with people now happy (and wanting to) return to in-person events and meetings. In fact, the recent findings of UK-based events and technology company Reed Exhibitions (RX) shows that for 78% of survey respondents attending trade shows in person is still their business’ preference, which is up from 68% in 2021. Furthermore, according to a Forbes Insights survey, 84% of executives prefer in person meetings for their ability to build more meaningful business relationships.
When it comes to effective networking, Christopher Voss, a former FBI hostage negotiator and founder and CEO of The Black Swan Group, who was speaking at GITEX for the second year in a row, believed that one should ensure that cultural differences do not stand in the way of such interactions.
↓ Christopher Voss, founder and CEO, The Black Swan Group
“Have empathy, as it is about understanding where the other side is coming from, and that is acceptable in all cultures, and above all, we all belong to the culture of being a human being,” Voss explained. “So, focus on understanding others as human beings, and then culture tends to fall away, because regardless of whether you are Asian, African, or Western European, everybody wants to be understood.”
Voss’ second piece of advice -which is to “avoid trying to connect with too many people at the events as big as GITEX”- was echoed by another speaker at the event: Roger Bassoul, Executive Director at Insead MENA. He added, “For many people, networking feels a bit like squeezing into trousers one size too small, but networking is essential if you wish to amass the social capital indispensable to a successful career. Its importance has not diminished with the overnight explosion of remote working. If anything, networking has become more critical, as jobs and advancement opportunities have been swept away by the coronavirus pandemic.” And in this new landscape, Bassoul suggested that it’s time to rename networking as relationship-building. “There are people who are good at making new ties or strengthening existing ties and others who are much better at ‘value exchange’,” he said. “That is, giving and eventually getting something in return. Both are crucial in relationship building.” According to Alex Chehade, General Manager, Binance, if one wishes to make the best out of the networking opportunities they are presented with, they first need to to have a a clear idea of who they would like to meet and start building relationships with. “It is who you think could mutually benefit from a conversation with you,” he said. “Once on-site, it’s always worth remembering that most people are there for very similar reasons, and that a potentially life-changing connection is only one ‘hello’ away.” Agreeing with this was Alizar Tawil, founder of the online hijab clothing company Ruuq, who won the MENA finals of the 2022 TiE Women Global Pitch Competition staged by the Dubai outpost of global entrepreneurship network TiE at GITEX GLOBAL. Tawil was selected among 42 finalists from 10 countries, 20 cities and 13 different industries across all five regional finals. She will receive $25,000 in equity-free cash from e&capital, as well as represent the MENA region in the global finals at TiE Global Summit in December in Hyderabad, India, where she will compete for the $100,000 equity-free prize money.
According to Tawil, networking at events like GITEX Global is essential for startups “who don’t necessarily have experience in the business world.” “For me, things like venture capital and term sheets were very foreign concepts
THERE ARE PEOPLE WHO ARE GOOD AT MAKING NEW TIES OR STRENGTHENING EXISTING TIES AND OTHERS WHO ARE MUCH BETTER AT ‘VALUE EXCHANGE’. BOTH ARE CRUCIAL IN RELATIONSHIP BUILDING.
→ The 2022 edition of the GITEX GLOBAL also included the North Star startup conference that gathered 35 unicorns from 15 countries. ↑ Roger Bassoul, Executive Director, Insead MENA
S/Ecosystem
←TiE Women 2022 winner Alizar Tawil, founder of the online hijab clothing company Ruuq
→ Shadman Sakib, founder and CEO, Vurse
FOR ME, THINGS LIKE VENTURE CAPITAL AND TERM SHEETS WERE VERY FOREIGN CONCEPTS BEFORE GETTING INTO THIS.
before getting into this,” she added. “To get to meet all these people in such a concentrated place and to get the exposure has been absolutely phenomenal.” Meanwhile, Shadman Sakib, a serial entrepreneur who is currently the founder and CEO of interactive short video platform Vurse, reiterated the importance of networking for startup founders. “All startups build and thrive on communities, and building an active community happens through partnerships, communication, and obviously, networking,” he said. “Partnerships are very important in the startup phase, and there are two types- vanity partnerships, and partnerships that really adds value and exhibits patience, since the startup phase indeed is a delicate time.”
And for those of you who are in the midst of that fragile startup phase, Voss shared three important pieces of advice for building win-win relationships. “Make sure that you have heard out the other side properly, because the likelihood that they are going to tell you something really valuable that will change your perspective increases if you hear them out first,” Voss said. “Then, if you need them to hear you out, given that you have heard them out first, they are going to be in a position to listen.” Now, if you are entering into these conversations with the explicit aim to make a deal happen, then Voss suggests that you first make sure that there is indeed a real deal to realize in the first place. “In many cases, the deal will never be there,” he explained. “There are certain types of attributes and behaviors of people that are either there to exploit you or to play you off against somebody else, like they are looking for a competing bid, and they want you to drive the price down on somebody else. Or they only want it if they don’t pay you anything, like they are promising you great things in the future ‘if you will just do this now,’ so they are trying to exploit you. Or they are not looking to do anything, but they want you to give them free consulting, they want you to tell them how to do something, so that they can do it on their own and not pay you.”
Finally, when it comes to networking effectively, Voss said one needs to always be clear about what they want out of any such undertaking. “Don’t make people guess what it would take to make a great deal with you,” Voss declared. “Never make people guess what you need.”
→ The 2022 GITEX GLOBAL showcased a two-seater flying car, the Chinese-made prototype Xpeng X2, as well as Dubai’s first driverless taxis.
THE EXECUTIVE SUMMARY
Q&A WITH ALEX CHEHADE, GENERAL MANAGER, BINANCE
At GITEX GLOBAL 2022, how did you ensure that you and your enterprise were networking effectively? "Any company preparing to fully harness the benefits of attending an event such as GITEX should objectively assess the value and challenges that it might face. With a clear trajectory in mind for our regional expansion, at GITEX, we were able to align with the tech experts and government entities present at the event on the importance of innovation and security for further virtual asset adoption in the Middle East. What was extremely important for me to highlight at this year’s GITEX was the significance of an effective regulatory framework for developing a trustworthy virtual asset ecosystem. If we aim to put Dubai on the map as a global virtual asset hub, a dialogue between regulatory entities and industry leaders is crucial.”
THE EXECUTIVE SUMMARY
Q&A WITH MAHA MOFEEZ, ACTING CHIEF EXECUTIVE, TAMKEEN
At GITEX GLOBAL 2022, how did you ensure that you and your enterprise were networking effectively? "Preparation is a very important aspect of successful networking. Since we aimed to represent Bahrain’s business ecosystem and highlight the kingdom’s position as a tech hub both in the GCC and MENA region through our participation, we prepared for our participation at GITEX well in advance, taking great care in curating every aspect of the Bahrain delegation's participation including in terms of the setup and design of the pavilion."
The numbers don’t lie
Female entrepreneurs in the MENA are still struggling to fundraise, says new report released at GITEX GLOBAL 2022
Female entrepreneurs across the MENA region still struggle with establishing good connections with investors, with a report released by Wamda, TiE Dubai, and TiE Women at GITEX GLOBAL 2022 showed that almost two-thirds of female founders believe that MENA-based investors are less likely than global investors to invest in women-led startups. The report further states that in the first nine months of 2022, less than US$50 million was invested in startups founded solely by women- about 2% of the total ($2.4 billion) funds injected into the region. Startups with both male and female co-founders raised $127 million in total, or 5% of the total. However, the region is not unique in this regard, investment patterns here are reflective of global trends, where in 2021 just 2% of the $6.4 billion venture capital investments was directed at female-founded startups.
Farah Emara, co-founder of Egypt-based agritech startup FreshSource, said in a statement that there was a significant gender gap in the regional markets mostly due to prevailing cultural and social norms. “I am optimistic that through these reports, we are able to raise awareness on women’s rights and inspire women to achieve their full potential,” she said. “Building FreshSource as a woman in the agriculture industry has been a challenging journey, but I am lucky to have a great co-founder, team, mentors, and programs that can support me along the way.” Commenting on the ecosystem at large, Ashish Panjabi, President of TiE Dubai, said that it’s high time for MENA investors to change their outlook on female entrepreneurs. “We need to look at women entrepreneurs as just entrepreneurs, because our global TiE Women competition has shown us that these entrepreneurs are innovative, and that they deserve to be treated as equals with the same checks and balances as any other business that is looking for investment,” Panjabi said. “This means our investor ecosystem needs a mindset change.” tiewomen.org
S/Startup Finance
The stories behind the recent fundraising successes seen by MENA-based startups
by PAMELLA DE LEON and AALIA MEHREEN AHMED
→ The FlapKap team
FLAPKAP
flapkap.com
CAIRO-HEADQUARTERED REVENUEBASED FINANCING (RBF) PLATFORM FLAPKAP has raised US$3.6 million in a seed funding round led by US-based venture capital (VC) firms QED and Outliers, as well as Egypt-based VC firms Nclude and A15. The new round follows the $1.2 million FlapKap raised as an investment in March 2022- the same month the fintech startup was launched. FlapKap’s business model involves offering non-dilutive funding -a form of working capital that doesn’t require a startup founder to give up equity or ownership when receiving it- to small and medium businesses (SMBs) and software-as-a-service (SaaS) firms, which is then repaid as a fixed percentage of the revenue they generate. “This means that whatever investment we make into the business is repaid, along with our small fixed fee, as a fixed percentage of the daily sales, till the total outstanding amount is fully repaid,” Ahmed Coucha, co-founder and CEO of FlapKap, explains. “In other words, our clients pay us back only when they sell. If sales increase, so do our repayments. And, vice versa, repayment slows down if sales fall.” Now, it is no secret that the e-commerce boom witnessed through the course of the coronavirus pandemic incentivized a lot of businesses to start selling online. Coucha, however, laments that this shift magnified a lot of funding-related issues for the already financially underserved SMB market. “On the one hand, e-commerce SMBs, which are constantly struggling to access the needed funds for growth, are not easily understood by the traditional banks,” Coucha says. “Not to mention that the banking process is very slow for their growing needs, and that
excessive collaterals are usually required, which add extra risk on the founders. On the other hand, getting investors’ money to finance working capital means giving up equity. This creates an adverse incentive for growth. The more these companies can grow, the more the founders will lose in their ownership. Not to mention that this option is only available to a select few. That’s why we have created what we call a 3F offering: fast, flexible, and founder-friendly funding.”
The chain of events that sparked Coucha’s inspiration for FlapKap, however, came much before the pandemic had even begun. “More than 11 years ago, I co-founded a digital advertising agency, which has now grown into a much larger advertising network called GP&K,” Coucha recalls. “At GP&K, we have mostly worked with what we call the ‘top-of-thepyramid’ clients such as Amazon, Netflix, Coca-Cola, P&G, and many others. But along our journey, we realized that aside from offering these clients advertising services, we were also offering them banking services, and the larger the client’s budget, the more generous credit terms they get. This always struck me as counterintuitive and a bit ironic. We thus felt that this was an immense opportunity to help the ‘middle-of-the-pyramid’ SMEs. During the coronavirus e-commerce boom, I came across the RBF model, and that’s when we decided to start FlapKap to become the first RBF player in the MENA.”
From Coucha’s perspective, while FlapKap caters to a very niche issue in the funding ecosystem, it doesn’t necessarily see itself as a separate entity in the grand scheme of things either. “FlapKap acts as a missing puzzle piece, supporting our partners as an extended department,” he explains. “Our business model can solve their working capital issues with the media or inventory funding within 48 hours.” But flexibility in financing apart, by offering tools such as intuitive dashboards that provide insights on advertisement spending, as well as a spend-now-pay-later feature for inventory management, FlapKap also seeks to provide a holistic solution for SMB founders. “We support our clients in optimizing their digital ads through an artificial intelligence (AI) model that we are building, as well as access to our growth experts, and that’s why we see ourselves as a full-fledged growth solution,” Coucha adds. “We support our customers in optimizing their business and identifying growth areas, then fund them in the most flexible way to realize this growth.” With the funds they have now raised, the FlapKap team hope to be able to scale their services across the MEA region. “While the newly raised funds will be used to fuel more growth for our customers, the majority of the funds will be deployed to more clients across KSA, UAE, and Egypt,” Coucha says. “Another part will be used in scaling our tech platform and further investing in our AI model to generate more meaningful insights for our partners.” FlapKap’s decision to raise a seed round, however, wasn’t always on the cards, reveals Coucha.”Since our launch, we’ve been receiving generous interest from the investment community, but we had to respectfully turn down their offers as we had enough cash to go for another year at least and we wanted to focus on building the product,” Coucha says. “However, we decided to open the round when we received interest from QED. Aside from being one of the largest fintech investors in the world, QED is the leading investor in the RBF space globally. They were also amongst the first investors in our global peers, Wayflyer and Fairplay, who have collectively raised over $900 million of debt and equity. So, it was a no-brainer for us that getting such an esteemed partner on board early on can accelerate our growth massively.” It was this decision to open a strategic ad-hoc round for QED that eventually led to FlapKap also partnering with the aforementioned VC firms Outliers and Nclude.
Now, in light of how the ongoing funding winter has led to a stagnation in investment opportunities for many startups, Flapkap’s story may not be particularly reflective of most funding anecdotes in the region right now. But Coucha still has a few words of advice for fellow entrepreneurs seeking to secure investments in the region right now. “Raising during this time is not an easy task at all with many VCs following a strategic wait approach, but despite ours not being a typical round, there are so many learnings that can be helpful,” Coucha says. “The most important of these learnings is to raise when you are not most in need. Raising while short in cash will force us into a survival mindset, not a strategic one. We don’t want to be raising to survive, we hopefully want to raise to thrive!”
S/Startup Finance
CASHEE
cashee.com
CASHEE, A UAE-BASED DIGITAL BANKING PLATFORM tailored for teenagers in the MENA region, has raised US$3 million in a Series A funding round led by Arab National Bank (ANB). With the capital infusion, ANB has also acquired an undisclosed stake in the startup.
Founded in 2020 by Brad Whittfield and Smeetha Ghosh, Cashee is on a mission to encourage financial literacy and financial inclusion for youth in the MENA region. Headquartered in Dubai, Cashee offers a Visa prepaid card and digital banking applications (available for Android and and iOS devices) for teens aged 13 years and above. It also offers a digital knowledge platform for teens to learn personal finance skills and money management habits, while also providing parents with control over their children’s transactions on its mobile applications. Since its launch, Whittfield notes the Cashee app has been downloaded in the UAE approximately 90,000 times, with it also seeing over 40,000 sign ups. In March of this year, the team also joined Visa International’s Fintech Fast Track Program, enabling the startup to take advantage of Visa’s global network for its business.
Commenting on the new funds, Whittfield states that it will be used for Cashee’s expansion plans in KSA, and thus, make its solutions and products available to a new market of younger generations and teens. Whittfield also notes that partnering with ANB, considered one of the most prestigious banking institutions in the region, is a definite advantage and catalyst that will help them achieve their expansion goals. “It’s more of a strategic investment relationship, unlike [a] VC, which is focused on exit,” he adds. The partnership also aligns with ANB’s efforts on the bank’s digital transformation journey and further expand the scope of financial inclusion, says Aiedh AlZahrani, COO and Head of Retail Banking Group, ANB. “The partnership between ANB and Cashee aims to develop the first banking application of its kind in Saudi Arabia that promotes the financial culture among Saudi youth, in a way that will encourage savings, financial literacy and other worthwhile goals, as a contribution from the bank to achieving one of the primary goals of Vision 2030,” AlZahrani says.
“The MENA youth market is very large,” Whittfield says, when asked about the potential of a fintech platform catered for teenagers. “In KSA, we are targeting 9-19 years old, which represents over 6 million and close to 18% of the total population.” He also notes that the youth market remains completely untapped, given the historical restrictions on how teenagers can open a bank account, as well as the high penetration for digital adoption among the younger generation.
As for fellow entrepreneurs who are looking to raise funds currently in the ecosystem, Whittfield candidly shares the importance of obtaining capital as needed. “As with all financial products, there are a lot of inherent dependencies and regulatory approvals required,” he says. “This is a good thing- if it were easy, everyone would do it. However, the time it takes to navigate the white-water rapids of the fintech ecosystem needs a decent amount of seed funding.” Plus, Whittfield also highlights the significance of having well-rounded team. “Digital payment knowledge is beyond paramount. Having a great team is great, but I can safely say that our collective track record in the payments space and relationships in the ecosystem was critical for our fundraising success.” Whittfield’s final piece of advice for entrepreneurs is to always look to the long-term: “Think two years ahead, constantly.”
↑ AlZahrani, COO and Head of Retail Banking Group, Arab National Bank, and Brad Whitfield, co-founder of Cashee
RUBA
findruba.com
RUBA, A KUWAIT-BASED FINTECH STARTUP WITH A MISSION to make education accessible, has raised an undisclosed amount in an oversubscribed pre-seed funding round from a select number of strategic angel investors. Founded in 2021 by Ameen Nadoom, Fawaz Al-Rashdan, and Menawer Al-Azmi, Ruba enables parents to pay for their children’s school tuition fees in easy instalments on a monthly basis at zero cost. The startup currently partners with private nurseries, K-12 schools, universities, and other academic providers in Kuwait, and it also aims to expand across the MENA region soon.
According to co-founder and CEO Nadoom, Ruba initially started off as a smart directory to help parents make an educated decision about the best school for their child’s future. Seeing the market’s needs as well as feedback for their product, Nadoom says he and his team then decided to shift their startup’s focus “by offering a Shariah-compliant enroll-now-pay-later (ENPL) solution for private schools and nurseries in the region.”
Armed with experiences in careers ranging from management consulting, banking, telco, and retail
→ Ruba co-founders Ameen Nadoom, Fawaz Al-Rashdan and Menawer Al-Azmi
in the GCC and North America, the co-founders were keen to tackle the challenges that parents encounter when faced with costly tuition fees over two or three installments every school year, which can result in cash flow issues and a lot of stress. With Ruba’s fully digital platform however, parents can easily request for a breakdown of the lump sums into affordable monthly installments, and at the same time, eliminate reconciliation challenges and delays for educational institutions.
Having gone live with the platform earlier this September, Nadoom says the traction Ruba has witnessed so far has been tremendous. “We are grateful to all the educational institutions and parents who believed in us from the start,” he says. “We aren’t just any typical financing solution, but we are one focused on a social cause that will touch the lives of every household.” Nadoom is also confident about the platform’s differentiating factors from competitors in the market. The platform provides a full digital onboarding process that is focused and dedicated to offering a financing solution, says Nadoom. The startup’s presence in Kuwait is a bonus too. He adds, “Being GCC locals and having a very good understanding of the culture and the market overall [helps as well].”
The new infusion of capital will now be used to grow Ruba’s team and further launch the digital solution and market it across the region. Besides that, in the coming months, the team plans to include more universities as early as next year and expand to the KSA market in early 2023. When asked for his advice for entrepreneurs seeking to raise funds like he did with Ruba, Nadoom advises, “Start early and budget in ample time, prioritize smart money, and listen and learn.” And finally, he adds: “Never give up.”
In The Loop/
The Future is Electric
KSA’s HRH Crown Prince Mohammed Bin Salman launches Ceer, the first Saudi electric vehicle brand
Saudi Arabia’s HRH Crown Prince Mohammad bin Salman bin Abdulaziz Al Saud, Prime Minister, and Chairman of the Public Investment Fund (PIF) has announced the launch of Ceer, the Kingdom’s first electric vehicle (EV) brand.
Besides aligning with the country’s efforts to boost its automotive manufacturing sector, the launch of Ceer is also part of PIF’s strategy to diversify the KSA economy, as well as contribute to the country’s efforts towards carbon emissions reduction and sustainability.
In the statement, Prince Salman said, “Saudi Arabia is not just building a new automotive brand, we are igniting a new industry and an ecosystem that attracts international and local investments, creates job opportunities for local talent, enables the private sector, and contributes to increasing Saudi Arabia’s gross domestic product (GDP) over the next decade, as part of PIF’s strategy to drive the economic growth in line with Vision 2030.”
As the first Saudi automotive brand to produce EVs in the country, Ceer will design, manufacture, and sell a portfolio of vehicles for consumers, including sedans and sports utility vehicles. With the launch of the company, the release noted that it is projected to attract over US$150 million of foreign direct investment and create up to 30,000 direct and indirect jobs.
The company is a joint venture between PIF and Hon Hai Precision Industry Co. (Foxconn), and it will license component technology from BMW for use in the vehicle development process. Foxconn will develop the electrical architecture of the vehicles, whilst each vehicle will be designed and manufactured in Saudi Arabia and tested to global automotive quality control and safety standards.
The partnership is a significant step that combines expertise and vision, noted Young Liu, Chairman of Hon Hai Technology Group. “We will leverage Foxconn’s technological expertise to support Ceer’s vision of creating a range of iconic electric vehicles that are built around the themes of connectivity, infotainment, and autonomy. We want to make electric vehicles mainstream, and that is what Ceer is going to achieve in Saudi Arabia and the wider region.”
Ceer vehicles are expected to be in the market by 2025, and they are projected to directly contribute $8 million to KSA’s economy by 2034. ceermotors.com
